The Bank of Ghana (BoG) has partnered with two institutions to create opportunities for international trade and financial cooperation for micro, small and medium enterprises (MSMEs) in the country.
The central bank signed a memorandum of understanding (MOU) with its Singaporean counterpart, the Monetary Authority of Singapore (MAS) and the Development Bank Ghana (DBG) last week to develop the Ghana Integrated Financial Ecosystem (GIFE).
A joint statement from the three partners said the agreement aimed to enhance financial capabilities and access for MSMEs in the country.
It said it would help them to generate greater opportunities for trade and financial services cooperation between Singapore and Ghana.
“Over time, it is envisaged that the integrated financial ecosystem model can serve the Asia-Africa SME trade corridor more broadly,” the statement said.
The statement explained that GIFE would offer an open digital infrastructure for MSMEs in Ghana and Singapore in four key areas.
It listed the areas to include SME financial empowerment programme to help MSMEs build foundational digital financial literacy skills and gain a good understanding of cross-border financial services.
It said it would also help MSMEs in Ghana and Singapore to expand their international business connections in Asia and Africa, through a network of business-to-business electronic-commerce platforms.
“The DBG and partner financial institutions will provide digital trade finance and guarantees for eligible MSMEs through a digital platform.
“The MAS, BoG, DBG and financial institutions will jointly develop financial trust frameworks to assess creditworthiness for financing by enabling financial institutions to use alternative data sets, such as the track record of successful payments to suppliers and tax payments to relevant authorities,” the statement said.
The statement explained that the GIFE was a collaborative effort across public and financial entities, FinTechs and tech solution providers in Ghana and Singapore.
It said the collaborating institutions included Proxtera3, Consolidated Bank of Ghana, ANEXT Bank, Enterprise Singapore, and the Global FinTech Institute.
The Chief FinTech Officer of MAS, Sopnendu Mohanty, said the MAS had worked closely with BoG since the announcement of the Financial Trust Corridor in 2020.
“The GIFE is an important step to foster closer collaboration between the two central banks and important emerging markets. The GIFE is a rethink to potentially leapfrog traditional financial inclusion approaches with combined support mechanisms powered by smarter data that MSMEs and financial institutions can tap into based on their needs,” Mr Mohanty said.
The Governor of BoG, Dr Ernest Addison, said the memorandum further demonstrated the bank’s commitment to working with key stakeholders to explore innovative financing models.
“It also further demonstrates our commitment to the Business Sans Borders initiative, which we partnered with the MAS to enhance MSME contribution to economic growth and in line with the government’s broader economic transformation goals,” Dr Addison said.
The Chief Executive Officer (CEO) of DBG, Mr K. Duker, said the bank believed that the partnership would mark a pivotal moment in DBG’s mission to provide sustainable finance solutions to Ghanaian businesses and facilitate multi-generational, sustainable economic growth.
He said the DBG recognised the crucial role of SMEs in the country’s economy and the GIFE programme would further strengthen the bank’s ability to catalyse SME growth by ensuring that they got the financial solutions they needed to achieve their full potential.
According to him, SMEs were a key pillar of Ghana’s economic resilience, prosperity and international competition; hence, the optimism that the journey to unlock their potential would yield excellent results for the people and the country.